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March 2018 Volume 7 Issue 1

The Value of Project Management to Business

 

 

 

Do these sound familiar?  “None of my I.T. projects finish on time.” “After a 30% cost over-run and exceeding our timeline by 6 months, we still have not completed the project.” “Our project is a mess and our stakeholders’ expectations have not been met.”

 

An I.T. project that has overrun budgeted costs, man-days, and timelines is not a rarity.  The average large IT project runs 45% over budget, 7% over time, and delivers 56% less value than expected. [1] One in six IT projects has an average cost overrun of 200% and a schedule overrun of 70%[2]

 

Many factors contribute to these over-runs and one of the more common ones is the lack of a proper project management process.  In this article, we make the case for Project Management – an often taken-for-granted function that can deliver tremendous value to projects AND to your business. 

 

A solid project management discipline is necessary to deliver projects on time and on budget.  Those who view project management as additional cost or overhead misses a very important point: that an unsuccessful project can be much costlier and may cause far greater damage than one can imagine – to the business, its financial position, its ability to respond to market opportunities, its reputation, and in extreme cases its viability as a going concern.

 

Jordan Sims, director of organization relations and programs for the Project Management Institute, explains in his article “Realizing the Value of Project Management” that “Regardless of an organization’s industry or mission, project management is the value driver that helps organizations get the most out of their performance.”

 

Let us look at some of the many ways a project manager (PM) drives value:

 

  1. Break down complexity through planning and organization
    1. I.T. projects have become so big and so complex.  An astute project manager divides projects into more manageable parts, marked by milestones. 
    2. The project manager is responsible for creating a project plan with clear roles, tasks, and deliverables.  This helps sets clear expectations for team members, management, and other stakeholders.
  2. Control costs and scope

The project manager is the overall financial manager for the project.He or she keeps tab of project spending to ensure that it stays on budget and that unplanned spending is minimized. A good project manager also ensures that a project is properly scoped from the beginning and that “scope creep” – the uncontrolled expansion of a project’s scope – is avoided.

  1. Risk management

At the beginning of the project, the PM works with the team to identify potential risks to the project and to devise strategies to manage these risks.As a result, threats to the plan are mitigated and the project can stay on plan.

  1. Quality management

Throughout the life of the project – from planning to execution – it is part of the PM’s role to ensure that project delivery is carried out in accordance with agreed quality standards.If the standards are not being met, the PM conducts root cause analysis and addresses the issue promptly.The PM builds activities in the plan – such as end-user testing – to ensure that quality standards are met.

  1. Ease of Communication

Having a PM removes the complexity of managing communication between the different members of a project team.As the primary point of contact for project communication, the PM manages-

  1. Project reporting to various stakeholders, including the Project Sponsor/s

  2. Scheduled face-to-face communication via meetings

  3. Ad hoc communication on issues, technical questions, requests for information, project scope changes, and many others

  4. Stakeholders and ensures their expectations and queries are addressed promptly

  5. The flow of project information such that there is always a single version of the truth

  1. Stay on top of project issues

It is important to note that a skilled project manager following a good management process does not make project challenges and issues go away.  However, he or she will know how to anticipate, manage, and deal with these problems in a way that will have minimal impact to the overall project metrics.  Furthermore, by keeping an issues log, a PM is able to monitor the efficiency of the team in managing issues.

  1. Documentation, reporting, and administration

A good project manager knows when to call a meeting and who to bring to the table.He or she is able to limit unnecessary discussions and administrative overhead on the team.A good PM will also have minimum requirements for project documentation and ensures that these are followed for compliance, for reference, and for legal and historical purposes.

  1. Building trust and enhancing team productivity

Project Management is both a science and an art.The science is in the processes, standards, and methodologies.The art is in getting a diverse group of people to unite towards a common objective – i.e. completing the project on time, on budget, and in accordance with set quality standards.It is the PM’s role to foster a collaborative team environment to facilitate decision-making and to speed up issue resolution.

  1. Share lessons learned

A good project management process will always include a formal closure report, captured in a project repository.The closure report must include lessons learned.The information will provide the basis for continuous improvement.

When businesses have a good handle on what is happening in their projects, it makes it much easier to make decisions on future endeavors.  A good project management methodology provides the framework for repeatable project success.

 

If you’d like to know more about how Project Management can help your business, let’s have a dialogue.  Email:  rsholmes@nexustech.com.ph

 

[1] Project Management Institute: Pulse of the Profession 2015: Capturing the Value of Project Management 2015

[2] Harvard Business Review: “Why Your IT Project May Be Riskier Than You Think”

 

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